Markets Live: South32, Alumina push ASX higher

The risk of a global energy shock is rising rapidly as the looming US sanctions on Iran and a rising US dollar combine to export layers of stress to the rest of the world.

While the renewed US sanctions don't officially kick in until early next month they are already having a significant effect as Iran's customers scramble to find different sources of supply.

Iranian oil production is falling quite rapidly – its September production was, at 1.72 million barrels a day, more than 250,000 barrels a day lower than in August. There are expectations that once the sanctions bite it could lose at least twice that amount of production and potentially more than a billion barrels of oil a day.

Stephen Bartholomeusz has the full piece here.

Australia had a $1.6 billion trade surplus in August, lifting 4 per cent from the previous month according to the ABS, with the result exceeding consensus expectations of a $1.4 billion surplus

"It looks as though net exports are on track to subtract around 0.2 ppts from real GDP growth in the third quarter after having added 0.1 ppts in the first," said Capital Economics chief Australia & New Zealand economist Paul Dales.

"The recent weakening in the dollar, though, should mean that net exports add to GDP growth next year. The 0.5% m/m rise in exports values was due to a 3% m/m gain in rural exports (despite the drought) and a 13% m/m leap in gold exports more than offsetting a 1% m/m decline in non-rural exports.

"Within the latter, iron ore exports values fell by 3% m/m and coal export values dropped by 2% m/m. The fall in coal may be repeated in the coming months if it is due the reported clamp down on coal imports by Chinese authorities in order to support local mines."

The Australian sharemarket is still trading higher just after midday with the major banks and resources dominating the gains.

The S&P/ASX 200 index is up 35.5 points, or 0.6 per cent, at 6181.6.

Australia has the potential to capture more wealth and jobs from its lithium sector by moving down the battery supply chain but this would be contingent on a number of factors, one of the federal government's top economists thinks.

In his resources and energy quarterly update Department of Industry, Innovation and Science chief economist Mark Cully said lithium and battery demand could result in billions of dollars for a country that grabbed the opportunity.

"Countries which capitalise on the opportunities of the emerging global lithium market could earn hundreds of billions of dollars in coming decades, and could play a pivotal role in fostering a new wave of clean energy technology around the world," he said.

Hamish Hastie has the full story here.

The two ASX-listed funeral companies are likely to be winners from the fall-out of the Hayne royal commission because funeral insurance sold by some insurers has come in for harsh criticism and could be shut down by regulators, leaving the pre-paid contracts offered by the duo much more appealing to consumers.

InvoCare, which has about 33 per cent of the Australian funerals market, and smaller rival Propel Funeral Partners, only offer pre-paid contracts where people can pay up front and lock in a future funeral service at today's prices.

Magellan Financial Group co-founder Hamish Douglass is stepping down as chief executive and will become chairman, switching roles with current chairman Brett Cairns.

​Mr Douglass will remain as chief investment officer and lead portfolio manager of the fund's global equities strategies while Dr Cairns will assume all operational duties, the company said a statement to the Australian Securities Exchange ahead of the its annual general meeting.

Bank of Queensland cash profits slipped 2 per cent in the year, to $372 million, as its bottom line was affected by higher costs, and a fall in income from bank fees and insurance.

BOQ, which reports its results over a financial year ending in August, said banks were facing a "difficult" environment as loan growth slowed, and its non interest income declined sharply.

The Australian sharemarket has enjoyed a strong advance at the open with the banks and major resource stocks all lifting.

The S&P/ASX 200 index is up 29.5 points, or 0.5 per cent, at 6175.6.

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The local sharemarket is poised to open higher after Wall Street finished in the black, despite a late afternoon fade that saw it retreat from intra-day highs, writes Kyle Rodda.

Here are the overnight market highlights:

SPI futures up 13 points or 0.2% to 6156 at about 6.40am AEST